Digital technology has changed the way we operate daily profoundly. According to a study addressed in Kotler’s Principles of Marketing, over half of Americans sleep with their mobile phone next to them (Kotler et al, 2016). He also describes the relationship between consumers and their mobiles as a “love affair” therefore indicating that it is a possession we all cannot live without. Thus, traditional marketing methods have changed enormously since the introduction of new technology.
What is Digital Marketing?
Digital marketing can be defined as “The marketing of products or services using digital channels to reach consumers. The key objective is to promote brands through various forms of digital media” (The Financial Times Lexicon, 2016). To extend the definition further, digital marketing can be said to be “specific, interactive and always on” (Flores, 2014). This further strengthens Kotler’s description that mobiles are the first thing people look at in the morning, and the last thing they touch at night.
It is important to create a division between digital marketing and Internet marketing. The latter is merely one aspect of digital marketing. Digital marketing goes above and beyond Internet marketing and accesses other digital media that can include television, radio, and mobile technology channels (Flores, 2014). That being said, it is clear that firms need to have a marketing strategy that is internet-based to perform well in the modern era (Tiago and Veríssimo, 2014). Digital marketing as a concept is becoming evidently superior to traditional marketing methods. Industry expert Forrester exclaimed in 2012 that digital marketing will become ‘marketing’ by 2013 as the vast majority of marketers will become “inherently digital” by the end of the year (Forrester, 2012 cited in Flores, 2014).
How does Digital Marketing work?
The relationship between technological advances and the evolution of marketing methods is distinctly positive. As new technology has emerged it has altered the way in which firms can communicate with their customers (Ryan, 2014:4). It is fair to say that technology, especially in the last ten years, has underpinned key breakthroughs in marketing. Understanding Digital Marketing author Damian Ryan puts forward the idea of a cyclical process in terms of the relationship.
Adapted from Ryan (2014)
Examples of this can be television, radio, newspapers, and the latest can now be the Internet. All of these were major breakthroughs in the respective eras and changed marketing distinctly. It is important however, to remember that these technologies do not define digital marketing. As with traditional marketing, it is all about the people. Flores (2013) explains how digital marketing methods are derived from the traditional methods and can be said to be exact replicas moved into the digital atmosphere. The author extends their explanation by using the definition of direct marketing where he explains that whether or not the marketers are using traditional or digital marketing; they will still be engaging in conversation with an individual target. Patrutiu-Baltes (2016) also states“the focus remains on the consumer, on his correct identification, on his needs, in order to lay the basis of effective communication strategies towards him.”
The History of Digital Marketing
In order to fully understand digital marketing, it is important to reflect on how it started and the path it has taken to become what it is today. To do this we can look at the relevant research that took place in the various eras it has been present in. Lamberton and Stephen (2016) presented a thematic exploration of digital marketing and constructed three themes present in three eras from the years 2000 to 2015. The reasoning behind beginning research at this time was due to the fact that academic literature on the digital topic began in 1998 with the Journal of Interactive Marketing being launched and also the first mention of digital marketing from Iacobucci (1998) explaining the possibility of customisation and higher responsiveness. Below is a summary of the findings from each era within the themes.
Tutorialspoint (date unknown)
ERA 1: Digital Media Shapes and Facilitates Buyer Behavior, 2000–2004
Theme 1: The Internet as a Platform for Individual Expression
§Kozinets (2002) examined consumers’ communication interactions in online communities and showed how these digital spaces could be sources of information for marketers seeking to understand consumer expression.
These online communities were precursors to social media networks
§Kozinets (2002) work continued to aid marketers including his work in netnography which showed how online communities could be worthwhile sources of data to derive consumer perceptions.
§Godes and Mayzlin (2004) conducted a study of how online word of mouth in online discussion forums connected to television show ratings. Godes and Mayzlin found that online WOM had an effect on television consumption, which prompted significant research into the effects of online WOM on a large range of marketing outcomes.
Theme 2: Internet as Search and Decision Support Tool
§Haubl and Trift (2000) studied two decision tools: recommendation agents and comparison matrices. This moulded two previous research topics, consumer behaviour research and the new shopping setting.
§Results indicated that the decision aids “promoted search of higher-quality alternatives, lower search costs, and better choices, compared with shopping without decision aids.”
§Researchers such as Brynjolfsson and Smith (2003), Lynch and Ariely (2000), and Kornish, and Lynch (2003) argued around the topic of price vs. quality. There were many discussions on whether or not these decision tools aided price-competition, non-price competition, or even both.
§Ansari and Mela (2003) considered how customised electronic communications could be used to aid customer decisions and reduce information overload.
Theme 3: Internet as a Marketing Intelligence Tool
§From the study devised by Ansari and Mela (2003), it was clear to see that using the Internet as a marketing tool could benefit both consumers and the firms.
§Deliberation around the subject began with the research by Ansari, Essegaier, and Kohli (2000) on intelligent recommendation agents. Before 2000, some work had already introduced shared filtering as a recommendations mechanism for example Breese, Heckerman, and Kadie (1998) but had unsatisfactory results: sparse data, product heterogeneity, etc.
§Although results were far from superior, marketing specialists did believe that the Internet had a great future as a marketing tool. In 2004 it was estimated that spending on online advertising would rise by 25% (Case, 2004). Wee (2016)
ERA 2: Consumers Shape DSMM: WOM and Networks, 2005–2010
During this era Internet penetration had reached 70% in the UK and 68% in the US (Office for National Statistics, 2017) and using the Internet for social networking and online WOM became mainstream. The reasoning behind this was partially due to knowledge and recognition but also with online review platforms such as Yelp being founded in 2004 (Lamberton and Stephen, 2016). This in turn meant that marketers had to gain a deeper understanding of these platforms and how social networking and the online atmosphere can aid marketing campaigns.
Theme 1: Online WOM as Individual Expression That Matters to Marketing
§In Era 2, the theme of individual expression was now being used more directly for marketing purposes. This built on the knowledge from Godes and Mayzlin (2004) and the rise of user-generated content allowed marketing teams to gather knowledge from online reviews as the growth of e-commerce was exponential.
§The rise of UGC led to many research teams diving into the topic to gain a further understanding of its effects in marketing. One example was the study by Chevalier and Mayzlin (2006) who observed online ratings and reviews of books on Amazon and Barnes & Noble, and their effects on the sales of these books on the two websites.
§Trusov, Bucklin, and Pauwels (2009) considered the effects of online WOM versus those from traditional advertising methods. They conducted this via the “refer a friend” system and analysed the long-term effects on customer acquisition. They concluded that online WOM had better, more sustainable effects.
§Era 2 was essentially a building block of era 1. After understanding online WOM more deeply, the rise of user-generated content asked new questions of marketers and researchers had a new topic to understand. Dellarocas (2006) considered the opportunities for firms to manipulate UCG and online WOM in order to generate more profit and consumer surplus.
Themes 2 and 3 Converge: Digital Networks as Tools for Information and Value
§New technology began emerging such as mobile. Shankar and Balasubramanian first cited this in 2009.
§One of the major questions during era 2 was who was influencing the “diffusion of networks”. Up to this point it was customary for researchers to study the “seed” as this is who originally posted the content. However they identified previous work by Katz, Blumler, & Gurevitch (1974) who exclaimed that the audience has it’s own choice in terms of the media they choose. This information was vital for marketers.
§Trusov, Bodapati, and Bucklin (2010) developed a method to identify ‘influential’ people in terms of online WOM and digital marketing in general. Influence was defined by the significance of their effect on others.
§Era 2 did respond to the concerns of marketers from era 1 with the understanding of searches and consumer expression via user-generated content. However there was a lull in research between 2004-2006 where there were no academic citations of ‘digital’, ‘online’, or ‘Internet’ (Lamberton and Stephen, 2016).
Scalar (date unknown)
ERA 3: The Age of Social Media, 2011-2014
Era 3 made“the connected consumer” its upmost priority. Internet penetration in 2013 reached 89.8% in the UK and 84.2% in the US (Office for National Statistics, 2017) therefore indicating that the vast majority of consumers were ‘always on’ and ‘constantly connected’. The iPhone was now a prominent figure for digital marketing with applications such as Instagram, Twitter and Snapchat allowing consumers to be shaped by marketing and vice versa.
Theme 1: Individual Self-Expression as a Means of Amplifying or Dulling Marketing Actions
§Due to the fact that consumers were in effect putting their entire lives onto social media, it turned these networks into new marketing platforms.
§Content related drivers were the key to research within this era and theme. Berger and Milkman (2012) expressed that “high-arousal” content is more likely to be distributed online by consumers than content that is “low-arousal”.
§Toubia and Stephen (2013) found that when the number of followers or ‘friends’ a consumer had increased, so did their UCG. This meant that marketers could personalise their campaigns to individual groups of people in order to get the best return possible.
Theme 2: User-Generated Content as Marketing Tool
§In earlier eras digital technology had been seen as a possible tool for advertising messages and searches. Ghose, Ipeirotis, and Li (2012) designed a hotel ranking system wholly based on crowd-sourced content.
§Studies also found that the amount of conversation affected firms’ performances in terms of stock, trading, and returns (Tirunillai and Tellis, 2012)
§At this point in time, it was evident for digital marketers that the audience played a huge part in their marketing efforts and therefore the success of their firm.
Theme 3: Capturing Marketing Intelligence in Specific Social Media Platforms
§During this period researchers began specific investigations on social media platforms. This was meaningful to both the firms and the consumers as the firms can derive marketing information and billions of consumers online and therefore these consumers will receive more targeted marketing efforts.
§ An example of work can be Toubia and Stephen’s (2013) study on Twitter that allowed researchers to go above and beyond the previous observational methods.
§In 2010, it was obvious that Digital Marketing was at the forefront of most marketing mixes and a study by Beer (2010) found that 60% of senior managers were now “very interested” in the topic.
§By the end of era 3, marketers envisaged Facebook as their main digital platform for leads as they focused on engagement on their posts in the hope they would get a return in either increased awareness or potentially sales.
It is clear to see from the history of Digital Marketing that the original concept has been researched since the late 1990s. Citations in general have escalated since era 1 as researchers discovered new ways that firms could use the digital sphere to their advantage.
Digital Marketing in Management – Organising for Success
Businesses worldwide are constantly adapting to new technologies and idea due to the dynamic state of our world. This is no different for digital marketing. Parsons, Zeisser, and Waitman (1998) conducted a study of twelve Fortune 500 companies and found that companies seem to pass through four distinct stages when moving their marketing efforts to digital. They provide a table that summarises each stage:
Parsons, Zeisser, and Waitman (1998)
Ad Hoc Activity In the late 1990s, companies began to start initiating their online presence. However this was usually on a voluntary basis by a select number of employees. Parson’s study found that in one major bank a selection of twenty employees had regular bi-weekly meetings to discuss the creation of a new website. Interested increased at this bank and over 50 volunteers from various departments now attended these meetings to discuss their digital efforts. However it became too large for open democratic discussions as people now had opposing opinions.
Focusing the Effort The second stage comprises of a small dedicated team for digital marketing. Parsons, Zeisser, and Waitman (1998) describe this as a “cross-functional steering committee” which includes members of senior management. Resources will still be limited for digital marketing as the area is still relatively new. Hence only a maximum of ten people were found to be dedicated to digital marketing during this stage. Although there is now a team in place, there is still no digital strategy and companies were found to use the team as an experiment in this stage to then create a strategy from one of their successful approaches.
Formalisation During formalisation, the digital marketing team becomes formalized turning the team into a permanent member of the business. The team on average extends to around 30 people who are separated into sub sections such as Marketing and Advertisement.
Parsons, Zeisser, and Waitman (1998)
An example from the study was from a Newspaper firm. They decided to create an online version but separated it completely from the print version, therefore it had its own strategy and dedicated staff. It can be difficult to find appropriate staff at this point as the talent pool for digital marketing and publishing was still very shallow when the digital age began. Nowadays this pool is much deeper as firms can bring in freelancers to help with their digital and media needs. In 2015 there were 1.91 million freelancers in the UK and 328,000 of these were in “Artistic, literary & media occupations” (IPSE, 2015).
Institutionalizing capability The final stage of organising digital marketing is integrating it successfully with the businesses core activities. One example of changes during this stage can be for firms to create new managerial positions to link the digital area of the business with the rest. In one consumer services company, they divided these managers into sections based on the digital technology they were using. At the time this was: Online services, Internet, and Dial-up (Parsons, Zeisser, and Waitman, 1998).
The key points when organising for digital marketing are as follows:
§Getting it started is more important than making it perfect §Involve Senior Management early on. §Manage conflicts with the rest of the business effectively §Don’t be afraid to outsource to find the necessary skills §Adapt to younger staff
The Positive Effect of Digital Marketing
Dollar Shave Club’s launch video now has over 24 million views on YouTube and shows how effective digital marketing can be on society. The company now has over one million subscribers and was recently acquired by Unilever for $1 billion (Siu, 2016).
Disadvantages of Digital Marketing
When taking a birds eye view of digital marketing, it is important to look at the disadvantages as well as the advantages. As previously mentioned, digital marketing goes above and beyond the internet however it only takes a couple of minutes of research to realise that the majority of the subject in the modern era revolves around the Internet. Taking this into consideration, digital marketers in 2017 and beyond will need to focus on the negative impacts of online digital marketing. Some points have been raised by Digital Marketing Philippines (2013):
1.Internet marketing campaigns can be copied or even used to mock your brand 2.Internet marketing can be drowned out by online advertising unrelated to the topic 3.Internet marketing needs to be conducted professionally in order to have success 4.Internet marketing may not be appropriate for your product – think target market, will the elderly see your adverts? 5.Competition – the digital market is very saturated 6.Reputation can be easily damaged by bad reviews/feedback 7.Internet marketing is dependent on the latest technology – this can be ridden with errors and is also very dynamic 8.Internet marketing is not yet embraced by all people – although penetration is high in the developed world, to reach some countries in Africa and Asia for example, offline marketing will be needed.
The Future of Digital Marketing
The technology sector is very difficult to forecast. From the original research of digital marketing in the 1990s it is fair to say that the academics then would not have thought the topic would have grown to what it is today. Therefore even if current researchers had a crystal ball they would still not be 100% certain on what the future lies for digital marketing. Ryan (2014) explains how the past has taught us to “expect rapid and unprecedented change” and goes on to say how it went from a “talent show wannabe” to a “ headlining Broadway act”.
Digital marketing relies heavily on trends. Facebook has offered various new trends to digital marketers to enhance their online presence. One trend that began to resurface in the final quarter of 2016 was the silent video. Research showed that the average viewing time of a video on Facebook in 2016 was 1.7 seconds meaning that people are most likely scrolling past videos and watching without sound (Cahill, 2016). This trend was unexpected therefore reinforcing the fact that the future cannot be easily predicted.
Conclusion
Is it New?
Digital marketing will always be new. This is because the topic is so diverse and ever changing. Although it is evident that the concept has been developed for over 20 years: fads, fashions, and trends are always occurring adding new dimensions to digital advertising (i.e. Instagram, Snapchat, etc). Some concepts identified in era 1 of Parson’s thematic exploration are now out-dated and therefore will not be considered as new. However in my opinion the topic as a whole is an up-to-date, modern area of marketing.
Is it a Trend?
Looking back at the quote from Forrester it is clear to see that digital marketing is a trend. They explained how digital marketing would become “just marketing” and that it will be a necessity rather than a luxury. It is clear with the naked eye that society has been affected and there are hundreds of more companies using digital marketing methods with advertisements over a variety of social media platforms. However a recent study from Chaffey (2013) identifies that not all companies are buying into the trend.
From Chaffey (2013)
Is it Management? When firms turn to digital marketing it is imperative that there is effective management in place. The four stages proposed by Parsons, Zeisser, and Waitman (1996) identify that management will change dramatically as they begin organising for digital marketing success. Companies will need to create new teams and ensure that these are integrated successfully into the rest of the business. Management is also important for issues such as privacy and reputation management.
Is Digital Marketing a New Trend in Management?
References
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Beer, J. (2010), New Survey Targets Digital Marketing, Marketing Magazine, 115 (17), 13
Berger, J (2014) Word-of-Mouth and Interpersonal Communication: A Review and Directions for Future Research, Journal of Consumer Psychology, 24 (4), pp. 586–607
Breese, J., Heckerman, D., and Kadie, C (1998) Empirical Analysis of Predictive Algorithms for Collaborative Filtering, Proceedings of the 14th Conference on Uncertainty in Artificial Intelligence. New York: Association for Computing Machinery, pp. 45–53.
Brynjolfsson, E., and Smith, D (2003) Consumer Surplus in the Digital Economy: Estimating the Value of Increased Product Variety at Online Booksellers, Management Science, 49 (11), 1580–96.
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Webhelpy Technologies (2016)Table of Contents
Introduction
Digital technology has changed the way we operate daily profoundly. According to a study addressed in Kotler’s Principles of Marketing, over half of Americans sleep with their mobile phone next to them (Kotler et al, 2016). He also describes the relationship between consumers and their mobiles as a “love affair” therefore indicating that it is a possession we all cannot live without. Thus, traditional marketing methods have changed enormously since the introduction of new technology.What is Digital Marketing?
Digital marketing can be defined as “The marketing of products or services using digital channels to reach consumers. The key objective is to promote brands through various forms of digital media” (The Financial Times Lexicon, 2016). To extend the definition further, digital marketing can be said to be “specific, interactive and always on” (Flores, 2014). This further strengthens Kotler’s description that mobiles are the first thing people look at in the morning, and the last thing they touch at night.It is important to create a division between digital marketing and Internet marketing. The latter is merely one aspect of digital marketing. Digital marketing goes above and beyond Internet marketing and accesses other digital media that can include television, radio, and mobile technology channels (Flores, 2014). That being said, it is clear that firms need to have a marketing strategy that is internet-based to perform well in the modern era (Tiago and Veríssimo, 2014). Digital marketing as a concept is becoming evidently superior to traditional marketing methods. Industry expert Forrester exclaimed in 2012 that digital marketing will become ‘marketing’ by 2013 as the vast majority of marketers will become “inherently digital” by the end of the year (Forrester, 2012 cited in Flores, 2014).
How does Digital Marketing work?
The relationship between technological advances and the evolution of marketing methods is distinctly positive. As new technology has emerged it has altered the way in which firms can communicate with their customers (Ryan, 2014:4). It is fair to say that technology, especially in the last ten years, has underpinned key breakthroughs in marketing. Understanding Digital Marketing author Damian Ryan puts forward the idea of a cyclical process in terms of the relationship.Adapted from Ryan (2014)
Examples of this can be television, radio, newspapers, and the latest can now be the Internet. All of these were major breakthroughs in the respective eras and changed marketing distinctly. It is important however, to remember that these technologies do not define digital marketing. As with traditional marketing, it is all about the people. Flores (2013) explains how digital marketing methods are derived from the traditional methods and can be said to be exact replicas moved into the digital atmosphere. The author extends their explanation by using the definition of direct marketing where he explains that whether or not the marketers are using traditional or digital marketing; they will still be engaging in conversation with an individual target. Patrutiu-Baltes (2016) also states“the focus remains on the consumer, on his correct identification, on his needs, in order to lay the basis of effective communication strategies towards him.”
The History of Digital Marketing
In order to fully understand digital marketing, it is important to reflect on how it started and the path it has taken to become what it is today. To do this we can look at the relevant research that took place in the various eras it has been present in. Lamberton and Stephen (2016) presented a thematic exploration of digital marketing and constructed three themes present in three eras from the years 2000 to 2015. The reasoning behind beginning research at this time was due to the fact that academic literature on the digital topic began in 1998 with the Journal of Interactive Marketing being launched and also the first mention of digital marketing from Iacobucci (1998) explaining the possibility of customisation and higher responsiveness. Below is a summary of the findings from each era within the themes.Tutorialspoint (date unknown)
ERA 1: Digital Media Shapes and Facilitates Buyer Behavior, 2000–2004
Theme 1: The Internet as a Platform for Individual Expression
§ Kozinets (2002) examined consumers’ communication interactions in online communities and showed how these digital spaces could be sources of information for marketers seeking to understand consumer expression.
These online communities were precursors to social media networks
§ Kozinets (2002) work continued to aid marketers including his work in netnography which showed how online communities could be worthwhile sources of data to derive consumer perceptions.
§ Godes and Mayzlin (2004) conducted a study of how online word of mouth in online discussion forums connected to television show ratings. Godes and Mayzlin found that online WOM had an effect on television consumption, which prompted significant research into the effects of online WOM on a large range of marketing outcomes.
Theme 2: Internet as Search and Decision Support Tool
§ Haubl and Trift (2000) studied two decision tools: recommendation agents and comparison matrices. This moulded two previous research topics, consumer behaviour research and the new shopping setting.
§ Results indicated that the decision aids “promoted search of higher-quality alternatives, lower search costs, and better choices, compared with shopping without decision aids.”
§ Researchers such as Brynjolfsson and Smith (2003), Lynch and Ariely (2000), and Kornish, and Lynch (2003) argued around the topic of price vs. quality. There were many discussions on whether or not these decision tools aided price-competition, non-price competition, or even both.
§ Ansari and Mela (2003) considered how customised electronic communications could be used to aid customer decisions and reduce information overload.
Theme 3: Internet as a Marketing Intelligence Tool
§ From the study devised by Ansari and Mela (2003), it was clear to see that using the Internet as a marketing tool could benefit both consumers and the firms.
§ Deliberation around the subject began with the research by Ansari, Essegaier, and Kohli (2000) on intelligent recommendation agents. Before 2000, some work had already introduced shared filtering as a recommendations mechanism for example Breese, Heckerman, and Kadie (1998) but had unsatisfactory results: sparse data, product heterogeneity, etc.
§ Although results were far from superior, marketing specialists did believe that the Internet had a great future as a marketing tool. In 2004 it was estimated that spending on online advertising would rise by 25% (Case, 2004).
Wee (2016)
ERA 2: Consumers Shape DSMM: WOM and Networks, 2005–2010
During this era Internet penetration had reached 70% in the UK and 68% in the US (Office for National Statistics, 2017) and using the Internet for social networking and online WOM became mainstream. The reasoning behind this was partially due to knowledge and recognition but also with online review platforms such as Yelp being founded in 2004 (Lamberton and Stephen, 2016). This in turn meant that marketers had to gain a deeper understanding of these platforms and how social networking and the online atmosphere can aid marketing campaigns.
Theme 1: Online WOM as Individual Expression That Matters to Marketing
§ In Era 2, the theme of individual expression was now being used more directly for marketing purposes. This built on the knowledge from Godes and Mayzlin (2004) and the rise of user-generated content allowed marketing teams to gather knowledge from online reviews as the growth of e-commerce was exponential.
§ The rise of UGC led to many research teams diving into the topic to gain a further understanding of its effects in marketing. One example was the study by Chevalier and Mayzlin (2006) who observed online ratings and reviews of books on Amazon and Barnes & Noble, and their effects on the sales of these books on the two websites.
§ Trusov, Bucklin, and Pauwels (2009) considered the effects of online WOM versus those from traditional advertising methods. They conducted this via the “refer a friend” system and analysed the long-term effects on customer acquisition. They concluded that online WOM had better, more sustainable effects.
§ Era 2 was essentially a building block of era 1. After understanding online WOM more deeply, the rise of user-generated content asked new questions of marketers and researchers had a new topic to understand. Dellarocas (2006) considered the opportunities for firms to manipulate UCG and online WOM in order to generate more profit and consumer surplus.
Themes 2 and 3 Converge: Digital Networks as Tools for Information and Value
§ New technology began emerging such as mobile. Shankar and Balasubramanian first cited this in 2009.
§ One of the major questions during era 2 was who was influencing the “diffusion of networks”. Up to this point it was customary for researchers to study the “seed” as this is who originally posted the content. However they identified previous work by Katz, Blumler, & Gurevitch (1974) who exclaimed that the audience has it’s own choice in terms of the media they choose. This information was vital for marketers.
§ Trusov, Bodapati, and Bucklin (2010) developed a method to identify ‘influential’ people in terms of online WOM and digital marketing in general. Influence was defined by the significance of their effect on others.
§ Era 2 did respond to the concerns of marketers from era 1 with the understanding of searches and consumer expression via user-generated content. However there was a lull in research between 2004-2006 where there were no academic citations of ‘digital’, ‘online’, or ‘Internet’ (Lamberton and Stephen, 2016).
Scalar (date unknown)
ERA 3: The Age of Social Media, 2011-2014
Era 3 made“the connected consumer” its upmost priority. Internet penetration in 2013 reached 89.8% in the UK and 84.2% in the US (Office for National Statistics, 2017) therefore indicating that the vast majority of consumers were ‘always on’ and ‘constantly connected’. The iPhone was now a prominent figure for digital marketing with applications such as Instagram, Twitter and Snapchat allowing consumers to be shaped by marketing and vice versa.Theme 1: Individual Self-Expression as a Means of Amplifying or Dulling Marketing Actions
§ Due to the fact that consumers were in effect putting their entire lives onto social media, it turned these networks into new marketing platforms.
§ Content related drivers were the key to research within this era and theme. Berger and Milkman (2012) expressed that “high-arousal” content is more likely to be distributed online by consumers than content that is “low-arousal”.
§ Toubia and Stephen (2013) found that when the number of followers or ‘friends’ a consumer had increased, so did their UCG. This meant that marketers could personalise their campaigns to individual groups of people in order to get the best return possible.
Theme 2: User-Generated Content as Marketing Tool
§ In earlier eras digital technology had been seen as a possible tool for advertising messages and searches. Ghose, Ipeirotis, and Li (2012) designed a hotel ranking system wholly based on crowd-sourced content.
§ Studies also found that the amount of conversation affected firms’ performances in terms of stock, trading, and returns (Tirunillai and Tellis, 2012)
§ At this point in time, it was evident for digital marketers that the audience played a huge part in their marketing efforts and therefore the success of their firm.
Theme 3: Capturing Marketing Intelligence in Specific Social Media Platforms
§ During this period researchers began specific investigations on social media platforms. This was meaningful to both the firms and the consumers as the firms can derive marketing information and billions of consumers online and therefore these consumers will receive more targeted marketing efforts.
§ An example of work can be Toubia and Stephen’s (2013) study on Twitter that allowed researchers to go above and beyond the previous observational methods.
§ In 2010, it was obvious that Digital Marketing was at the forefront of most marketing mixes and a study by Beer (2010) found that 60% of senior managers were now “very interested” in the topic.
§ By the end of era 3, marketers envisaged Facebook as their main digital platform for leads as they focused on engagement on their posts in the hope they would get a return in either increased awareness or potentially sales.
It is clear to see from the history of Digital Marketing that the original concept has been researched since the late 1990s. Citations in general have escalated since era 1 as researchers discovered new ways that firms could use the digital sphere to their advantage.
Digital Marketing in Management – Organising for Success
Businesses worldwide are constantly adapting to new technologies and idea due to the dynamic state of our world. This is no different for digital marketing. Parsons, Zeisser, and Waitman (1998) conducted a study of twelve Fortune 500 companies and found that companies seem to pass through four distinct stages when moving their marketing efforts to digital. They provide a table that summarises each stage:
Parsons, Zeisser, and Waitman (1998)
Ad Hoc Activity
In the late 1990s, companies began to start initiating their online presence. However this was usually on a voluntary basis by a select number of employees. Parson’s study found that in one major bank a selection of twenty employees had regular bi-weekly meetings to discuss the creation of a new website. Interested increased at this bank and over 50 volunteers from various departments now attended these meetings to discuss their digital efforts. However it became too large for open democratic discussions as people now had opposing opinions.
Focusing the Effort
The second stage comprises of a small dedicated team for digital marketing. Parsons, Zeisser, and Waitman (1998) describe this as a “cross-functional steering committee” which includes members of senior management. Resources will still be limited for digital marketing as the area is still relatively new. Hence only a maximum of ten people were found to be dedicated to digital marketing during this stage. Although there is now a team in place, there is still no digital strategy and companies were found to use the team as an experiment in this stage to then create a strategy from one of their successful approaches.
Formalisation
During formalisation, the digital marketing team becomes formalized turning the team into a permanent member of the business. The team on average extends to around 30 people who are separated into sub sections such as Marketing and Advertisement.
Parsons, Zeisser, and Waitman (1998)
An example from the study was from a Newspaper firm. They decided to create an online version but separated it completely from the print version, therefore it had its own strategy and dedicated staff. It can be difficult to find appropriate staff at this point as the talent pool for digital marketing and publishing was still very shallow when the digital age began. Nowadays this pool is much deeper as firms can bring in freelancers to help with their digital and media needs. In 2015 there were 1.91 million freelancers in the UK and 328,000 of these were in “Artistic, literary & media occupations” (IPSE, 2015).
Institutionalizing capability
The final stage of organising digital marketing is integrating it successfully with the businesses core activities. One example of changes during this stage can be for firms to create new managerial positions to link the digital area of the business with the rest. In one consumer services company, they divided these managers into sections based on the digital technology they were using. At the time this was: Online services, Internet, and Dial-up (Parsons, Zeisser, and Waitman, 1998).
The key points when organising for digital marketing are as follows:
§ Getting it started is more important than making it perfect
§ Involve Senior Management early on.
§ Manage conflicts with the rest of the business effectively
§ Don’t be afraid to outsource to find the necessary skills
§ Adapt to younger staff
The Positive Effect of Digital Marketing
Dollar Shave Club’s launch video now has over 24 million views on YouTube and shows how effective digital marketing can be on society. The company now has over one million subscribers and was recently acquired by Unilever for $1 billion (Siu, 2016).
Disadvantages of Digital Marketing
When taking a birds eye view of digital marketing, it is important to look at the disadvantages as well as the advantages. As previously mentioned, digital marketing goes above and beyond the internet however it only takes a couple of minutes of research to realise that the majority of the subject in the modern era revolves around the Internet. Taking this into consideration, digital marketers in 2017 and beyond will need to focus on the negative impacts of online digital marketing. Some points have been raised by Digital Marketing Philippines (2013):1.Internet marketing campaigns can be copied or even used to mock your brand
2.Internet marketing can be drowned out by online advertising unrelated to the topic
3.Internet marketing needs to be conducted professionally in order to have success
4.Internet marketing may not be appropriate for your product – think target market, will the elderly see your adverts?
5.Competition – the digital market is very saturated
6.Reputation can be easily damaged by bad reviews/feedback
7.Internet marketing is dependent on the latest technology – this can be ridden with errors and is also very dynamic
8.Internet marketing is not yet embraced by all people – although penetration is high in the developed world, to reach some countries in Africa and Asia for example, offline marketing will be needed.
The Future of Digital Marketing
The technology sector is very difficult to forecast. From the original research of digital marketing in the 1990s it is fair to say that the academics then would not have thought the topic would have grown to what it is today. Therefore even if current researchers had a crystal ball they would still not be 100% certain on what the future lies for digital marketing. Ryan (2014) explains how the past has taught us to “expect rapid and unprecedented change” and goes on to say how it went from a “talent show wannabe” to a “ headlining Broadway act”.Digital marketing relies heavily on trends. Facebook has offered various new trends to digital marketers to enhance their online presence. One trend that began to resurface in the final quarter of 2016 was the silent video. Research showed that the average viewing time of a video on Facebook in 2016 was 1.7 seconds meaning that people are most likely scrolling past videos and watching without sound (Cahill, 2016). This trend was unexpected therefore reinforcing the fact that the future cannot be easily predicted.
Conclusion
Is it New?
Digital marketing will always be new. This is because the topic is so diverse and ever changing. Although it is evident that the concept has been developed for over 20 years: fads, fashions, and trends are always occurring adding new dimensions to digital advertising (i.e. Instagram, Snapchat, etc). Some concepts identified in era 1 of Parson’s thematic exploration are now out-dated and therefore will not be considered as new. However in my opinion the topic as a whole is an up-to-date, modern area of marketing.
Is it a Trend?
Looking back at the quote from Forrester it is clear to see that digital marketing is a trend. They explained how digital marketing would become “just marketing” and that it will be a necessity rather than a luxury. It is clear with the naked eye that society has been affected and there are hundreds of more companies using digital marketing methods with advertisements over a variety of social media platforms. However a recent study from Chaffey (2013) identifies that not all companies are buying into the trend.
From Chaffey (2013)
Is it Management?
When firms turn to digital marketing it is imperative that there is effective management in place. The four stages proposed by Parsons, Zeisser, and Waitman (1996) identify that management will change dramatically as they begin organising for digital marketing success. Companies will need to create new teams and ensure that these are integrated successfully into the rest of the business. Management is also important for issues such as privacy and reputation management.
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Images
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